Macroeconomic risk has ramped up in Turkey this year after the country’s ground troops entered a Kurdish enclave in Syria, and while the primary financial markets have shrugged off the action, there are cracks starting to show below the surface that indicate there might be economic struggles ahead.

Turkey waved off Arab League calls in the last few weeks to exit northern Syria, even as a Turkish soldier was killed when an explosive device went off during a security search on April 19 to act as a grim marker of almost four months since tanks rolled across Turkey’s southern border into its neighbouring country.

Turkish president Recep Tayyip Erdogan has vowed to destroy the Kurdish YPG in the northern Afrin region in an exercise called Operation Olive Branch. This has prompted the regional Arab League – made up of 22 states around the Middle East and North Africa – to pass a resolution calling for Turkish forces to withdraw from Syria. Turkey rejected the request, with a spokesperson for Turkey’s minster of foreign affairs, Hami Askoy, suggesting that the Arab League misunderstood the country’s military presence in Syria.

“Operation Olive Branch executed by the Turkish Armed Forces in Afrin is, first and foremost, a counter-terrorism operation for the purposes of self-defence,” said Askoy on April 17. “It also serves to preserve the political unity and territorial integrity of the country as it is executed against a terrorist organization that seeks to divide Syria.”